May 27, 2009 Phone Conversation 

Mike Sorcher 

M A Associates 

(913-663-0100) 

msorcher@matdf.com

We are the largest seller and purchaser of TDF in the country. 

One thing about our company is that we have a pretty broad view of this business; we pioneered 

the development of tire-derived fuel. A lot of the information at the RMA is from us. 

Basically, in general, the tires are picked up by state-permitted tire collection companies. Those 

tire collection companies pick up the tires and will sometimes grade off the good, usable ones 

(sold). They get paid a $/tire. The tire retailer’s paying to get rid of the tire (separate from the tax 

imposed by the state). Half that price is freight in getting it to the processing facility, and the tire 

collector pays the processor. Lots of companies that mediate. Take it to a cement plant or a tire 

processing facility. That plant derives its revenues need the tipping fees at their front door to 

survive; need to call out the good usable tires; take the scrap rims and sell those; take out the 

inner tubes of the larger tires and pull them out and sell them; process the material and sell the 

material either as a civil engineering product or TDF or crumb rubber (3/4 inch minus) and sell 

that material. The finer you go, you have to be processing fine enough to sell your scrap steel. 

All those revenue sources minus your costs, if you’re missing any one of those things, the 

business goes down the tubes. 

So you directly purchase the TDF? 

Our business is we go to these processors and buy their fuel. We tell them the specification we 

want and barge it to our customers (paper and pulp, utility, co-generation facilities). These 

facilities use this material, we deliver it to them, we provide them with portable metering 

systems to meter the fuel into their fuel handling system, and we kind of hold their hand. Assist 

with environmental and operation issues. 

Do you have a sense of the range of market price for TDF? 

Most of the people that collect are also processors. But they also deal with some flow from the 

guy with the pickup truck. So you’re the one who decides how much it costs. Range of market 

price can range from the customer destination ($20 to 100 a ton). Depending on quality needed, 

amount of transportation to get it there, and the competing fuels that we’re replacing. Displacing 

primarily coal. In general. Sometimes, and sometimes oil or natural gas. But typically, coal. 

Power plant. 

Do you see a trend in terms of which plants/kilns want the TDF to be wire free? 

The trend is to take the TDF with wire removed. When you talk about utilities, the only ones that 

burn TDF are either cyclone boilers (NOX issues) or CFBs. The utilities that are burning tires 

have concluded that they do have to put the catalytic converter on for NOX emission control. 

And it’s been determined that the steel does not affect the catalyst. It can affect feeding system, 

affect operational difficulties in ash handling. 
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We know every single end user in the country. 

Utilities that might have a CFB boiler there are very few of them but they will also need higher 

quality material. Couple of them that have traveling grates. It’s very boiler-specific, every boiler 

is different. Overall the trend is to remove the trend. With certain ones, can operate with steel. 

So you see a trend with cement kilns taking TDF with a higher metal content? 

Well, cement kilns take whole tires. But the newer cement kilns can’t take whole tires. They 

need a smaller chip, and can handle it with steel. But as soon as you start processing to that 2 

inch minus size, you get a lot more money going to the industrial utility market versus going to 

cement kilns. Well, I’ll remove that steel since I’m processing to that size anyways, I can remove 

the steel and sell to higher prices. 

Overall, since 2000, you’ve seen the industrial market and utility/co-gen market make a push for 

alternative fuels but tires are very easy thing for them to go to. From a permitting/EPA 

standpoint. There’s been this drive towards alt. fuels. TDF is at the top of the list for pulp and 

paper/co-gen industry. It’s an easy fuel for them to use if we provide the metering systems. 

Sulfur content is either less than or equal to their coal. And it’s displacing a fossil fuel. 

Sometimes the boilers operate more efficiently and can burn more wood waste with the TDF all 

in one boiler. 

So what would be the standard percentage of metal removed? 

In making the quality fuel 2 inch plus 90%+ wire free. In doing that, you have a reject. Up to 

60% is rejected on the magnets. And then those magnets go to another processing line that 

reprocesses it down to crumb rubber. Mulch market, artificial turf markets. 

Do you know what facilities would be good to talk to? 

ABC Tire LLC is no good – they are not a typical facility. 

Liberty Atlanta is a good facility to talk to 

Columbus McKinnon --> Rick Collier or Charlie Estefan 800.848.1071. Their machines are 

used and SSI are used. One if hook and shear (SSI) and Columbus McKinnon is a block that sits 

on a rotar and there’s 50 of these things. Hook and shear is a 2 inch wide knife that goes around 

rotar and has points that shred. 2 different types of processing equipment. 

When you start going to crumb rubbe you go to high speed machines. 3⁄4 inch and smaller 

systems. 

Buy it from tire processors. Delivery price minus transportation cost plus profit margin for our 

company. Proper numbers anywhere from $30-90 a ton. General range that you would sell to 

burners. $50-60 would be a good delivered. Most of the users are Texas to Minnesota and on 

east. Very few TDF users, industrial utility boilers in the rocky mountain region. West Coast and 

northwest. 

It’s strange that I only hear about your firm yesterday, and yet it seems like you are at the top of 

the list? 
3 

We’re very quiet about what we do and do not want to be talked about that much. We are the 

largest marketer of TDF in the country. We want to be pretty quiet about what we do. 

I talked to a couple of companies who seem to directly contract with end-users, but the rest said 

they go through a broker. 

Any energy product in this country (oil, natural gas, coal, wood waste) are sold through brokers, 

through companies that ultimately deliver the product. There’s a lot of logistics in getting the 

fuel to market. We are a broker, so to speak, but we are a logistics company, we manage and 

assist our customers to make sure they’re making the right quality product and handle the 

logistics of transporting the material (barging or trucking) and we work with our customers 

operationally and provide metering systems to feed this material into their systems. 

What does this metering system look like? 

Metering system = it’s a hopper (a bin) with screw augers at the bottom of it that are variable 

speed controlled that discharge the material onto another transfer screw that raises it into the air 

so that it drops it onto their coal belt. 

What are the challenges that your firm faces in this market? 

Biggest challenge that the industry faces is a couple-fold: 

(1) making sure the states enforce the waste tire laws. The tires go with permitted collectors 

to a permitted processing facility. There has to be funds available to enforce the state 

regulations on the books. Challenge for the industry, not for us. Funding is always 

lacking at the enforcement side. 

(2) Markets. Developing markets and that is always a challenge for any industry but that is a 

challenge for this one. Finally at the point where TDF has been growing quite a bit over 

the last 4-5 years. People are looking for alternative fuels. And when one customer comes 

on they’ll use 30,000 tons a year = 3,000,000 tires = 5.5 million processed tires to meet 

that 3,000,000 tires. 40-50% reject rate. Some people can use that reject. Septic systems. 

(3) What do you do with the reject? Not so much what you do with the good stuff you make. 

Some systems you’ll have 50% reject rate versus 15% rate. Can fluctuate. The trend in general is 

to reject higher quantities and then take that reject and re-process it. Especially when scrap steel 

prices were higher. People over the last few years have made investments to do that. Sell the 

higher qualtity TDF and sell the steel. And sell the crumb rubber. But you have a lot more 

processing cost. TDF typically has to be 90% plus. 90-95% typically needs to be removed, but 

some markets can handle 25-50% and still use it. 

It’s an acceptable fuel, they’re dealt with it, they’re comfortable with it. So it’s an acceptable 

fuel. And in today’s industrial environment, the only reason the industry uses TDF is because it 

saves money. 

Crumb rubber market is holding steady and holding back a bit. 

state of texas RMA looking into potential scenario.